Onkyo Vs Panasonic set up

I'd like some advice please from someone who has a better understanding of home cinema.

I'll try to be brief.

I currently have a 32" Panasonic not HD in a room of about 4-5m square. I have a budget of about £350-500 and want to relplace our aging Pan dvd recorder and Pan SA-XR15 sound system. We don't have any blue ray although maybe I should consider for the future? Anyway this is what I've sort of come up with and would be glad to any views and alternative ideas if anyone has a view. Oh use of the system is TV / Record TV / DVD play/ some CD play / (Wii for the children).

OK 1st idea

Onkyo HT-S3405 (£250) + Pan DMR-EX83 EB-K (£170)

2nd idea

Pan SC-PT470 (£150) with HD recorder DMR-HW100EBK (£200)

Not being totally technical I think the 1st is the probably the better system but th esecond has the nice feature of the viera link. I suppose the question is, if the Onkyo is better, how much better.

Or is there another option I've not thought of?

Many thanks Lego dad963